19 year old / Savings / Help to buy ISA.

Korkyb

My (lucky...) 19 year old daughter currently has 29k in a normal instant access savings account.


She is just about to start her 1st proper job & should be earning around 20k per year. (?? should be around £1400ish take home per month).


She still stays at home (with her mother and I) and has no debts.


She's not exactly a party animal so (apart from going out now and then for a meal / cinema / night out with friends) her only real regular expenses are:


- Her car - owned outright with vehicle insurance currently £600ish / Tax £30. (+ usual car expenses including petrol for commute 8 miles each way on a country road so under a 15 min drive).


- Whatever her cruel parents decide to charge her for board & lodgings. (we are thinking about £200 per month but interested on your view about that....).


Anyway - savings....


What should she do with her current and future savings (she should be able to put aside a fair bit from her wage. (Not sure how much yet - have to see how frugal she really is).


She is interested in buying a property at some point - this could be in a couple of years but if the job goes well she might even jump within the next year or so before property prices ?? rise. (I've said if she does then to go for a 2 bedroom property & get a mate in to pay her rent.......???? if this is still the way to go nowadays).


I've been reading a wee bit about Help to Buy ISA's & that looks like a sensible thing to get in the meantime.


Any advice about which way I should guide her gratefully appreciated.

aj23_2

HTB would be sensible, they will be taken off sale end of the year though, so ASAP. Bonus is dependent on where you live, as it's only claimable on properties up to £250k outside London. And as she's only 19, likely to rise anyway. Best open to all rate is Barclays, however some building societies can beat that depending where you live.

If she has 29k spare, then definitely look into Lifetime ISA by Skipton, Nottingham or Newcastle building societies. For every £4k per tax year you deposit, HMRC will add a £1k cash bonus for use towards first home or as a lump sum available when she's 60.

crv1963

As aj23 has advised for the savings.

Board- I would have thought 15% reasonable, so £200 at just under seems okay. Even better value for her- if you don't need the money for you then save it, don't tell her and when she does move out give it back to buy some white goods or legal fees on her house purchase!

Korkyb

Cheers chaps.

Will advise to go for a HTB asap and look into a lifetime ISA.

AlexDee

crv1963 wrote: »

As aj23 has advised for the savings.

Board- I would have thought 15% reasonable, so £200 at just under seems okay. Even better value for her- if you don't need the money for you then save it, don't tell her and when she does move out give it back to buy some white goods or legal fees on her house purchase!

Similar to what my parents did for me and my brother. Charged us c.£150 a month which was worked out as an equal share of the monthly food shopping and bills. Then bought us things like a washing machine etc when we bought our first house.

OP, it sounds like your daughter is going about things the right way. Just encourage her to keep saving as much as possible. It sounds as if she’s in a better place financially than many others of her age!!